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just olya [345]
2 years ago
12

If real GDP is $150 billion, full employment GDP is $600 billion, and the marginal propensity to consume is 0.8, then Congress s

hould
Business
1 answer:
KengaRu [80]2 years ago
5 0

Answer:

increase government spending by $90 billion

Explanation:

in order to reach full employment GDP level, the government should increase its spending by $90 billion. Total GDP increase = increase in government spending / government multiplier = $90 billion / (1 - 0.8) = $90 billion / 5 = $450 billion.

GDP will increase from $150 billion + $450 billion = $600 billion

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A large corporation suffers from the​ principal-agent problem when​ its:
amm1812
<span>The correct answer is d. management does not own a large share of firm stock and pursues its own interests rather than those of shareholders.When management pursues its own interests, there is a conflict with the interest of the shareholders who hired the management in the first place.</span>
7 0
3 years ago
Read 2 more answers
Farmco just paid its annual dividend of $.32 per share. The dividends are expected to grow at 25 percent annually for the next 4
vitfil [10]

Answer:

$5.73(Approx).

Explanation:

Given:

= 0.32

Growth rate = 25% = 0.25

Number of year = 4

Growth rate after 4 year = 3% = 0.03

Required rate of return = 15% = 0.15

Computation of divined in 4 year:

Annual\ dividend\ paid(1+growth\ rate)^n\\\\0.32(1+0.25)^4\\\\0.32(1.25)^4\\\\0.32(2.44140625)\\\\0.78125

Price of stock after year 4 = [Divined in 4 year × (1 + new growth)] /[Required rate of return - Growth rate after 4 year ]

Price of stock after year 4 = [0.78125 × (1+0.03)] / [0.15 - 0.03]  

Price of stock after year 4 = [0.8046875] / [0.12]  

Price of stock after year 4 = $6.70572917

Present value = Future value / (1+r)^n

 Present value = $6.70572917 / (1.15)^4

 Present value = $6.70572917 / (1.16985856)

$5.73(Approx).

6 0
3 years ago
True or false most small business owners enjoy being part of a team
Mandarinka [93]
I believe the answer is false
4 0
3 years ago
ABC Tax Planning Service started business in January 2018. The company rented an office for $5,400 per month starting from Janua
Sholpan [36]

Answer:

balance in the Prepaid Rent account as of April 30 is $10800

Explanation:

given data

rent office =  $5,400 per month

rent paid = 6 month i.e January 1 to June 30

to find out

balance in the Prepaid Rent account as of April 30

solution

we know here that Period Expired till April 30 = 4 months ( January 1 to April 30)

and

so Period Balance = 2 Months  ( May 1 to June 30 )

so Prepaid Rent is = Balance Period × Rent per month

Prepaid Rent = 2  × 5,400

Prepaid Rent = $10800

so balance in the Prepaid Rent account as of April 30 is $10800

6 0
3 years ago
IBM expects to pay a dividend of $2 next year and expects these dividends to grow at 6​% a year. The price of IBM is $90 per sha
Elena-2011 [213]

Answer:

Cost of equity = 8.22%

Explanation:

Cost of equity = Dividend per share /current market value + growth rate of dividend  

Cost of equity = 2/90 + 6%

Cost of equity = 0.0222 + 6%

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Cost of equity = 8.22%

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3 years ago
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